Föhrenbergkreis Finanzwirtschaft

Unkonventionelle Lösungen für eine zukunftsfähige Gesellschaft

Posts Tagged ‘Economist’

Brexit could put Britain’s lambing industry to the slaughter

Posted by hkarner - 17. Februar 2019

Date: 14-02-2019
Source: The Economist: Bagehot

Farmers face being fleeced in the event of no deal

Shropshire is as close to the beating heart of England as you can get. The county towns boast some of England’s finest Norman castles and black-and-white houses. Wenlock Edge and the Long Mynd are studies in pastoral beauty—“blue remembered hills”, in A.E. Housman’s immortal phrase in “A Shropshire Lad”.

It is hardly surprising that Housman’s “land of lost content” should be a Brexit stronghold. Some 57% of Salopians voted to leave. Four of the county’s five mps are pro-Brexit; one of them, North Shropshire’s Owen Paterson, is about as hard-core as you can get. Yet Brexit represents the biggest threat in decades to Shropshire’s content—and not just to the handful of factories that supply parts for the car industry in the neighbouring Black Country, but also to the county’s traditional rural economy.

Sheep have always been at the centre of Shropshire’s farming. In the Middle Ages they paid for the black-and-white mansions and over-sized churches that add to the area’s charm. Today a third of Britain’s sheep graze within 100 miles of the centre of the county. Once or twice a week market towns such as Ludlow and Knighton resound to the age-old sounds of a sheep auction. A significant proportion of all these sheep end up in an abattoir in Craven Arms owned by a company called Euro Quality Lambs. Den Rest des Beitrags lesen »


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A threat to the independence of Italy’s central bank

Posted by hkarner - 16. Februar 2019

Date: 14-02-2019
Source: The Economist

The country’s populist leaders alarm European bankers

The bank of italy has long been seen as one of a handful of efficient and incorruptible institutions that curb Italy’s anarchic tendencies. But on February 9th this august establishment came under fire from the two deputy prime ministers who call the shots in the populist government that is nominally led by Giuseppe Conte, the prime minister. Matteo Salvini, who leads the hard-right Northern League, said he wanted to “reboot” the senior management at both the central bank and the stockmarket regulator, Consob. Luigi Di Maio of the Five Star Movement (m5s) demanded “discontinuity”. Both alleged the Bank had failed to protect investors and deposit-holders. Two days earlier, the cabinet had refused to approve a further six-year term for Luigi Federico Signorini, the deputy director-general primarily responsible for banking supervision.

The attack sent ripples of apprehension through the euro zone amid media stories that the populist coalition wanted to get its hands on the Bank’s gold reserves, the third-largest of any country, to fund its expansionary fiscal policies. The president of the Eurogroup of finance ministers, Mario Centeno, and the eu commissioner for economic affairs, Pierre Moscovici, both pointedly stressed the need to preserve the independence of central banks in the single currency area.

On an optimistic interpretation, the threats were perhaps not meant to be taken too seriously. The coalition leaders’ remarks were addressed to a very specific audience: an assembly of stakeholders who lost money when two banks in the Veneto region were liquidated in 2017. The government has promised partially to reimburse them. But eu rules on state aid could yet prevent that. Inveighing against the central bank enabled the party leaders to win plaudits from an unhappy audience. Den Rest des Beitrags lesen »

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Millennial socialism

Posted by hkarner - 16. Februar 2019

Date: 14-02-2019
Source: The Economist

A new kind of left-wing doctrine is emerging. It is not the answer to capitalism’s problems

After the collapse of the Soviet Union in 1991, the 20th century’s ideological contest seemed over. Capitalism had won and socialism became a byword for economic failure and political oppression. It limped on in fringe meetings, failing states and the turgid liturgy of the Chinese Communist Party. Today, 30 years on, socialism is back in fashion. In America Alexandria Ocasio-Cortez, a newly elected congresswoman who calls herself a democratic socialist, has become a sensation even as the growing field of Democratic presidential candidates for 2020 veers left. In Britain Jeremy Corbyn, the hardline leader of the Labour Party, could yet win the keys to 10 Downing Street.

Socialism is storming back because it has formed an incisive critique of what has gone wrong in Western societies. Whereas politicians on the right have all too often given up the battle of ideas and retreated towards chauvinism and nostalgia, the left has focused on inequality, the environment, and how to vest power in citizens rather than elites. Yet, although the reborn left gets some things right, its pessimism about the modern world goes too far. Its policies suffer from naivety about budgets, bureaucracies and businesses. Den Rest des Beitrags lesen »

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No-deal plans become ever sillier—and the public can’t wait

Posted by hkarner - 10. Februar 2019

Date: 09-02-2019
Source: The Economist

The government’s frantic preparations are both farcical and frightening

A refrigerated plane flying round-the-clock sallies to bring medicine to a besieged population, emergency waste centres established to deal with overflowing rubbish and martial law imposed on a restive population as the queen is whisked from the capital by helicopter to escape rioters. Leaks from the government’s preparations for a no-deal Brexit sometimes sound as if they have come from the imagination of a pulp-fiction novelist. Many Brexiteers blame the alternately frightening and farcical stories on dastardly “Remoaner” officials, working to undermine the case for leaving without a deal.

They can at least be reassured by the fact that no-deal preparations are no longer theoretical. Pinning down precise details of the government’s work is difficult, partly because of official secrecy and partly because big decisions—like what tariff regime will be implemented if Britain leaves the European Union without a deal—have yet to be taken by ministers. But the bureaucratic engine has kicked up a gear, with cross-government preparations being organised under the code name Operation Yellowhammer. Den Rest des Beitrags lesen »

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Italy’s populist government is dreaming of economic growth

Posted by hkarner - 10. Februar 2019

Date: 07-02-2019
Source: The Economist

In fact the country is in recession, and the coalition is cracking

For italy, 2019 will be bellissimo, its prime minister, Giuseppe Conte, said this month. The economy, he declared, could grow by up to 1.5%. With much of Europe at risk of slipping into recession, that sounds pretty good.

In fact, Italy is already in recession. Its gdp fell in both the third and fourth quarters of 2018, and few forecasters are as sanguine as Mr Conte. The Bank of Italy expects the economy to grow by just 0.6% this year. The prime minister is banking on an expansionary budget. If this fails to revive the economy, the two parties in his populist coalition, the Five Star Movement (m5s) and the nationalist Northern League, will be in trouble. Many question whether their fractious marriage can survive beyond summer. Den Rest des Beitrags lesen »

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Intel’s new boss leads a firm that is both thriving and troubled

Posted by hkarner - 10. Februar 2019

Date: 07-02-2019
Source: The Economist

It dominates PC and server chips. But its core business has misfired of late

After a seven-month search, Intel on January 31st announced that its new chief executive would be its chief financial officer. Robert Swan had been filling in as the boss since last year, when Brian Krzanich, his predecessor, left after violating company rules about relationships with subordinates. Mr Swan inherits a company with dominant products and an enviable market position—but also one whose core business has stumbled.

The good news is that an increasingly electronic world has an insatiable appetite for the computer chips that Intel makes. A week before Mr Swan’s appointment Intel announced results that reflected strong growth. Its annual revenue, of $70.8bn, set a record, and its operating income of $23.3bn was up by 29% from the same period in 2017 (though the numbers were slightly below the market’s expectations).

Intel’s chips power 84% of desktop computers, leaving scraps for Advanced Micro Devices, its only competitor. It has a near 100% market share in the more profitable market for the beefier chips used in data-centres and cloud-computing farms. Den Rest des Beitrags lesen »

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In the future, Eurasia will rule the world

Posted by hkarner - 10. Februar 2019

Date: 07-02-2019
Source: The Economist

But China won’t have everything its own way, say three stimulating new books

The New Silk Roads. By Peter Frankopan. Knopf; 336 pages; $26.95. Bloomsbury; £14.99.

The Future is Asian. By Parag Khanna. Simon & Schuster; 448 pages; $29.95. Weidenfeld & Nicolson; £20.

Belt and Road: A Chinese World Order. By Bruno Maçães. Hurst; 224 pages; $29.95 and £20.

Asked how he came to write “The Lord of the Rings”, J.R.R. Tolkien replied: “I wisely started with a map and made the story fit.” And so, says Bruno Maçães, when imagining new realities it is natural to begin the same way. These days a revised map of the world might have a radically different focus from previous ones—because a vast, integrated Eurasian supercontinent is proving to be the salient feature of an emerging global order.
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A bold new plan to tackle climate change ignores economic orthodoxy

Posted by hkarner - 9. Februar 2019

Date: 07-02-2019
Source: The Economist: Free exchange

The Green New Deal touted by Democrats largely dispenses with cost-benefit analysis

As deals go, the New one was a big one. Franklin Roosevelt’s plan to yank America out of depression permanently altered the contours of the country’s economy and politics. Proponents of a “Green New Deal” harbour similar ambitions. Though still nebulous the proposal, championed most loudly by Alexandria Ocasio-Cortez, a new congresswoman from New York, has been met with surprising enthusiasm in Washington. It is an outright rejection of the orthodox economic approach to climate change.

In economics, climate change is a big but straightforward example of a market failure, with a correspondingly straightforward solution. People take environmentally harmful decisions because the private benefits of doing so (using a car to get to work, say) outweigh the private costs (the price of the petrol to run the car). But emission-producing activities also impose social costs—deaths from pollution and collisions, the contribution of carbon emissions to climate change—that do not influence an individual’s decision to drive rather than walk or take public transport. To solve the climate problem, then, governments need only include the social cost of carbon in the prices people pay. Den Rest des Beitrags lesen »

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Margrethe Vestager, bane of Alstom and Siemens, could get the EU’s top job

Posted by hkarner - 8. Februar 2019

Date: 07-02-2019
Source: The Economist: Charlemagne

The competition commissioner would make a dynamic president of the Commission, but needs liberals to unite behind her

Rest in peace, “Trainbus”. On February 6th Margrethe Vestager, the European Union’s competition commissioner, vetoed a merger between Germany’s Siemens and France’s Alstom that proposed to do for train-building what Airbus has done for plane-building: create a European giant capable of competing with the world’s biggest. The move dismays Angela Merkel and Emmanuel Macron, who argue that Europe needs champions to take on rivals such as China’s crrc. But the commissioner ruled that the merger would eliminate competition in certain sectors, and argued that the eu should instead take on Chinese industrial might with better rules on state subsidies, data privacy and takeovers. Her wariness is welcome. Achieving competitive European firms through mega-mergers confronts the symptom—a lack of European industrial giants—rather than the underlying problem, which is insufficient integration of European markets.

Ms Vestager (pronounced “Vest-ayer”) does not shy away from making powerful enemies. Brought up in a bustling Lutheran parsonage in a coastal corner of Denmark, she is known in Brussels for her straight manner and dry humour. She arrived there in 2014 after a career in Copenhagen as education minister, economy minister and leader of Radikale, a small social-liberal party. Her detractors say she has since picked easy targets, predominantly American technology firms, to make herself popular. Den Rest des Beitrags lesen »

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Italy’s slump reflects trouble both at home and abroad

Posted by hkarner - 5. Februar 2019

Date: 02-02-2019
Source: The Economist

The weak economy complicates a fraught fiscal position

Italy boasts no glittering economic record. gdp growth has trailed the euro-area average every year since 1999. Despite a decent showing in 2016-17, the economy has yet to regain fully the output lost during the global crisis a decade ago and a domestic banking scare a few years later.

Now even its modest recovery seems to have gone into reverse. Figures published on January 31st showed that Italy slipped into recession in the second half of 2018. The economy shrank by 0.2% in the final quarter of 2018, its second consecutive contraction (see chart). The causes are both domestic and external. They seem likely to depress the economy this year, too, and to worsen an already fraught fiscal position.

The euro zone—notably Germany—has lost momentum as global trade has slowed. Italy has not been immune. Exports rose by nearly 6% in 2017, but Loredana Federico of UniCredit, a bank, reckons they probably grew by just 1% last year. Giada Giani of Citigroup, another lender, argues that the fate of Italy’s economy is tied to that of Germany’s, in part because of integrated manufacturing supply chains. Declining industrial production in Germany is likely to have spread south. (Germany’s gdp fell more sharply than Italy’s in the third quarter of 2018, though some of that dip was caused by a temporary halt to car production because of new emissions standards.) Den Rest des Beitrags lesen »

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